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Greece vs. Bulgaria

Economy

GreeceBulgaria
Economy - overview

Greece has a capitalist economy with a public sector accounting for about 40% of GDP and with per capita GDP about two-thirds that of the leading euro-zone economies. Tourism provides 18% of GDP. Immigrants make up nearly one-fifth of the work force, mainly in agricultural and unskilled jobs. Greece is a major beneficiary of EU aid, equal to about 3.3% of annual GDP.

The Greek economy averaged growth of about 4% per year between 2003 and 2007, but the economy went into recession in 2009 as a result of the world financial crisis, tightening credit conditions, and Athens' failure to address a growing budget deficit. By 2013, the economy had contracted 26%, compared with the pre-crisis level of 2007. Greece met the EU's Growth and Stability Pact budget deficit criterion of no more than 3% of GDP in 2007-08, but violated it in 2009, when the deficit reached 15% of GDP. Deteriorating public finances, inaccurate and misreported statistics, and consistent underperformance on reforms prompted major credit rating agencies to downgrade Greece's international debt rating in late 2009 and led the country into a financial crisis. Under intense pressure from the EU and international market participants, the government accepted a bailout program that called on Athens to cut government spending, decrease tax evasion, overhaul the civil-service, health-care, and pension systems, and reform the labor and product markets. Austerity measures reduced the deficit to 1.3% in 2017. Successive Greek governments, however, failed to push through many of the most unpopular reforms in the face of widespread political opposition, including from the country's powerful labor unions and the general public.

In April 2010, a leading credit agency assigned Greek debt its lowest possible credit rating, and in May 2010, the IMF and euro-zone governments provided Greece emergency short- and medium-term loans worth $147 billion so that the country could make debt repayments to creditors. Greece, however, struggled to meet the targets set by the EU and the IMF, especially after Eurostat - the EU's statistical office - revised upward Greece's deficit and debt numbers for 2009 and 2010. European leaders and the IMF agreed in October 2011 to provide Athens a second bailout package of $169 billion. The second deal called for holders of Greek government bonds to write down a significant portion of their holdings to try to alleviate Greece’s government debt burden. However, Greek banks, saddled with a significant portion of sovereign debt, were adversely affected by the write down and $60 billion of the second bailout package was set aside to ensure the banking system was adequately capitalized.

In 2014, the Greek economy began to turn the corner on the recession. Greece achieved three significant milestones: balancing the budget - not including debt repayments; issuing government debt in financial markets for the first time since 2010; and generating 0.7% GDP growth — the first economic expansion since 2007.

Despite the nascent recovery, widespread discontent with austerity measures helped propel the far-left Coalition of the Radical Left (SYRIZA) party into government in national legislative elections in January 2015. Between January and July 2015, frustrations grew between the SYRIZA-led government and Greece’s EU and IMF creditors over the implementation of bailout measures and disbursement of funds. The Greek government began running up significant arrears to suppliers, while Greek banks relied on emergency lending, and Greece’s future in the euro zone was called into question. To stave off a collapse of the banking system, Greece imposed capital controls in June 2015, then became the first developed nation to miss a loan payment to the IMF, rattling international financial markets. Unable to reach an agreement with creditors, Prime Minister Alexios TSIPRAS held a nationwide referendum on 5 July on whether to accept the terms of Greece’s bailout, campaigning for the ultimately successful "no" vote. The TSIPRAS government subsequently agreed, however, to a new $96 billion bailout in order to avert Greece’s exit from the monetary bloc. On 20 August 2015, Greece signed its third bailout, allowing it to cover significant debt payments to its EU and IMF creditors and to ensure the banking sector retained access to emergency liquidity. The TSIPRAS government — which retook office on 20 September 2015 after calling new elections in late August — successfully secured disbursal of two delayed tranches of bailout funds. Despite the economic turmoil, Greek GDP did not contract as sharply as feared, boosted in part by a strong tourist season.

In 2017, Greece saw improvements in GDP and unemployment. Unfinished economic reforms, a massive non-performing loan problem, and ongoing uncertainty regarding the political direction of the country hold the economy back. Some estimates put Greece’s black market at 20- to 25% of GDP, as more people have stopped reporting their income to avoid paying taxes that, in some cases, have risen to 70% of an individual’s gross income.

Bulgaria, a former communist country that entered the EU in 2007, has an open economy that historically has demonstrated strong growth, but its per-capita income remains the lowest among EU members and its reliance on energy imports and foreign demand for its exports makes its growth sensitive to external market conditions.

The government undertook significant structural economic reforms in the 1990s to move the economy from a centralized, planned economy to a more liberal, market-driven economy. These reforms included privatization of state-owned enterprises, liberalization of trade, and strengthening of the tax system - changes that initially caused some economic hardships but later helped to attract investment, spur growth, and make gradual improvements to living conditions. From 2000 through 2008, Bulgaria maintained robust, average annual real GDP growth in excess of 6%, which was followed by a deep recession in 2009 as the financial crisis caused domestic demand, exports, capital inflows and industrial production to contract, prompting the government to rein in spending. Real GDP growth remained slow - less than 2% annually - until 2015, when demand from EU countries for Bulgarian exports, plus an inflow of EU development funds, boosted growth to more than 3%. In recent years, strong domestic demand combined with low international energy prices have contributed to Bulgaria’s economic growth approaching 4% and have also helped to ease inflation. Bulgaria’s prudent public financial management contributed to budget surpluses both in 2016 and 2017.

Bulgaria is heavily reliant on energy imports from Russia, a potential vulnerability, and is a participant in EU-backed efforts to diversify regional natural gas supplies. In late 2016, the Bulgarian Government provided funding to Bulgaria’s National Electric Company to cover the $695 million compensation owed to Russian nuclear equipment manufacturer Atomstroyexport for the cancellation of the Belene Nuclear Power Plant project, which the Bulgarian Government terminated in 2012. As of early 2018, the government was floating the possibility of resurrecting the Belene project. The natural gas market, dominated by state-owned Bulgargaz, is also almost entirely supplied by Russia. Infrastructure projects such as the Inter-Connector Greece-Bulgaria and Inter-Connector Bulgaria-Serbia, which would enable Bulgaria to have access to non-Russian gas, have either stalled or made limited progress. In 2016, the Bulgarian Government established the State eGovernment Agency. This new agency is responsible for the electronic governance, coordinating national policies with the EU, and strengthening cybersecurity.

Despite a favorable investment regime, including low, flat corporate income taxes, significant challenges remain. Corruption in public administration, a weak judiciary, low productivity, lack of transparency in public procurements, and the presence of organized crime continue to hamper the country's investment climate and economic prospects.

GDP (purchasing power parity)$319.334 billion (2019 est.)

$313.469 billion (2018 est.)

$307.521 billion (2017 est.)

note: data are in 2010 dollars
$161.654 billion (2019 est.)

$155.894 billion (2018 est.)

$151.218 billion (2017 est.)

note: data are in 2010 dollars
GDP - real growth rate1.87% (2019 est.)

1.91% (2018 est.)

1.44% (2017 est.)
3.39% (2019 est.)

3.2% (2018 est.)

3.5% (2017 est.)
GDP - per capita (PPP)$29,799 (2019 est.)

$29,206 (2018 est.)

$28,594 (2017 est.)

note: data are in 2010 dollars
$23,174 (2019 est.)

$22,191 (2018 est.)

$21,371 (2017 est.)

note: data are in 2010 dollars
GDP - composition by sectoragriculture: 4.1% (2017 est.)

industry: 16.9% (2017 est.)

services: 79.1% (2017 est.)
agriculture: 4.3% (2017 est.)

industry: 28% (2017 est.)

services: 67.4% (2017 est.)
Population below poverty line17.9% (2018 est.)23.8% (2019 est.)
Household income or consumption by percentage sharelowest 10%: 1.7%

highest 10%: 26.7% (2015 est.)
lowest 10%: 1.9%

highest 10%: 31.2% (2017)
Inflation rate (consumer prices)0.2% (2019 est.)

0.6% (2018 est.)

1.1% (2017 est.)
3.1% (2019 est.)

2.8% (2018 est.)

2% (2017 est.)
Labor force4 million (2020 est.)3.113 million (2020 est.)

note: number of employed persons
Labor force - by occupationagriculture: 12.6%

industry: 15%

services: 72.4% (30 October 2015 est.)
agriculture: 6.8%

industry: 26.6%

services: 66.6% (2016 est.)
Unemployment rate17.3% (2019 est.)

19.34% (2018 est.)
5.66% (2019 est.)

6.18% (2018 est.)
Distribution of family income - Gini index34.4 (2017 est.)

35.7 (2011)
40.4 (2017 est.)

38.3 (2016)
Budgetrevenues: 97.99 billion (2017 est.)

expenditures: 96.35 billion (2017 est.)
revenues: 20.35 billion (2017 est.)

expenditures: 19.35 billion (2017 est.)
Industriestourism, food and tobacco processing, textiles, chemicals, metal products; mining, petroleumelectricity, gas, water; food, beverages, tobacco; machinery and equipment, automotive parts, base metals, chemical products, coke, refined petroleum, nuclear fuel; outsourcing centers
Industrial production growth rate3.5% (2017 est.)3.6% (2017 est.)
Agriculture - productsmaize, olives, wheat, milk, peaches/nectarines, oranges, tomatoes, grapes, milk, potatoeswheat, maize, sunflower seed, milk, barley, rapeseed, potatoes, grapes, tomatoes, watermelons
Exports$92.925 billion (2019 est.)

$88.511 billion (2018 est.)

$81.196 billion (2017 est.)
$42.369 billion (2019 est.)

$40.779 billion (2018 est.)

$40.091 billion (2017 est.)
Exports - commoditiesrefined petroleum, packaged medicines, aluminum plating, computers, cotton (2019)refined petroleum, packaged medicines, copper, wheat, electricity (2019)
Exports - partnersItaly 10%, Germany 7%, Turkey 5%, Cyprus 5%, Bulgaria 5% (2019)Germany 16%, Romania 8%, Italy 7%, Turkey 7%, Greece 6% (2019)
Imports$94.597 billion (2019 est.)

$91.798 billion (2018 est.)

$85.092 billion (2017 est.)
$44.853 billion (2019 est.)

$42.841 billion (2018 est.)

$40.53 billion (2017 est.)
Imports - commoditiescrude petroleum, refined petroleum, packaged medicines, cars, ships (2019)crude petroleum, copper, cars, packaged medicines, refined petroleum (2019)
Imports - partnersGermany 11%, China 9%, Italy 8%, Iraq 7%, Russia 6%, Netherlands 5% (2019)Germany 11%, Russia 9%, Italy 7%, Romania 7%, Turkey 7% (2019)
Debt - external$484.888 billion (2019 est.)

$478.646 billion (2018 est.)
$39.059 billion (2019 est.)

$41.139 billion (2018 est.)
Exchange rateseuros (EUR) per US dollar -

0.82771 (2020 est.)

0.90338 (2019 est.)

0.87789 (2018 est.)

0.885 (2014 est.)

0.7634 (2013 est.)
leva (BGN) per US dollar -

1.61885 (2020 est.)

1.7669 (2019 est.)

1.7172 (2018 est.)

1.7644 (2014 est.)

1.4742 (2013 est.)
Fiscal yearcalendar yearcalendar year
Public debt181.8% of GDP (2017 est.)

183.5% of GDP (2016 est.)
23.9% of GDP (2017 est.)

27.4% of GDP (2016 est.)

note: defined by the EU's Maastricht Treaty as consolidated general government gross debt at nominal value, outstanding at the end of the year in the following categories of government liabilities: currency and deposits, securities other than shares excluding financial derivatives, and loans; general government sector comprises the subsectors: central government, state government, local government, and social security funds
Reserves of foreign exchange and gold$7.807 billion (31 December 2017 est.)

$6.026 billion (31 December 2015 est.)
$28.38 billion (31 December 2017 est.)

$25.13 billion (31 December 2016 est.)
Current Account Balance-$3.114 billion (2019 est.)

-$6.245 billion (2018 est.)
$2.06 billion (2019 est.)

$611 million (2018 est.)
GDP (official exchange rate)$209.79 billion (2019 est.)$68.49 billion (2019 est.)
Taxes and other revenues48.8% (of GDP) (2017 est.)35.7% (of GDP) (2017 est.)
Budget surplus (+) or deficit (-)0.8% (of GDP) (2017 est.)1.8% (of GDP) (2017 est.)
Unemployment, youth ages 15-24total: 35.2%

male: 33.5%

female: 37.2% (2019 est.)
total: 8.9%

male: 9.3%

female: 8.3% (2019 est.)
GDP - composition, by end usehousehold consumption: 69.6% (2017 est.)

government consumption: 20.1% (2017 est.)

investment in fixed capital: 12.5% (2017 est.)

investment in inventories: -1% (2017 est.)

exports of goods and services: 33.4% (2017 est.)

imports of goods and services: -34.7% (2017 est.)
household consumption: 61.6% (2017 est.)

government consumption: 16% (2017 est.)

investment in fixed capital: 19.2% (2017 est.)

investment in inventories: 1.7% (2017 est.)

exports of goods and services: 66.3% (2017 est.)

imports of goods and services: -64.8% (2017 est.)
Gross national saving9.9% of GDP (2019 est.)

8.8% of GDP (2018 est.)

8.9% of GDP (2017 est.)
26.1% of GDP (2019 est.)

24.2% of GDP (2018 est.)

25.3% of GDP (2017 est.)

Source: CIA Factbook